Tag: economic mechanism

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Questions Related to economic mechanism

Multiple choice organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

Cross holding method of Disinvestment refers to ____________________.

  1. Government selling part of its Shares in one PSU to other PSUs

  2. Government selling Shares of PSUs to Public Sector Financial Institutions & Banks

  3. Government's own Financial Institutions buying Government's stake in select PSU's and holding them until any third buyer emerges

  4. None of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Cross holding method of Disinvestment refers to Government selling part of its Shares in one PSU to other PSUs.The term disinvestment is more popularly used where central/ state government sells its holdings of public sector companies.Disinvestment means selling of Public investment to a Private entrepreneur.Disinvestment of the public sector can be defined as a process of transferring the ownership of any enterprise from public to private sector.

Multiple choice organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

The term disinvestment is more popularly used ____________________________.

  1. Where a holding company sells shares of a Subsidiaray company

  2. Where an investment company off loads its holding

  3. Where central / State government sells its holdings of public sector companies

  4. None of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The term disinvestment is more popularly used where central/ state government sells its holdings of public sector companies.Disinvestment means selling of Public investment to a Private entrepreneur.Disinvestment of the public sector can be defined as a process of transferring the ownership of any enterprise from public to private sector.

Multiple choice organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

Comforts lies between the.

  1. Inferior goods and necessaries

  2. Luxuries and inferior goods

  3. Necessaries and luxuries

  4. None of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Comforts lies between necessaries and luxuries because comforts refer to those goods which are not required for a happy living.

Multiple choice organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

Privatisation refers to __________________.

  1. The transfer of assets or service functions from public to private ownership or control

  2. The opening of hitherto closed areas to Private Sector entry

  3. Both (a) and (b)

  4. Neither (a) nor (b)
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Privatization refers to -a) The transfer of assets or service functions from the public to private ownership or control

b) The opening of hitherto closed areas to Private Sector entry
In simple words, Privatization can be defined as a process of transferring ownership of an enterprise or industry from the public to the private sector.

Multiple choice organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

Equity Offer through 'Differential Pricing Method' primarily refers to ________________________.

  1. Government selling part of its Shares in one PSU to other PSUs

  2. Government selling Shares of PSUs to Public Sector Financial Institutions and Banks

  3. Government's own Financial Institutions buying Government's stake in select PSU's and holding them until any third buyer emerges

  4. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Differential pricing refers to different prices functional in the market based on various factors such as geography, external environment or various reasons. This implies that there is one product in the market, but, different people need to pay different prices for it. 

Cross holding method of Disinvestment refers to Government selling part of its Shares in one PSU to other PSUs. The term disinvestment is more popularly used where central/ state government sells its holdings of public sector companies. Disinvestment means selling of Public investment to a Private entrepreneur.

The correct option is B.

Multiple choice organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

Sale of a major portion of Government stake to a Strategic Buyer and also giving over the management control is called as ____________.

  1. Strategic Sale

  2. Cross Holding

  3. Warehousing

  4. Retaining Golden Share
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

When the government decides to transfer the ownership and control of a public sector entity to some other entity, either private or public, the process is called strategic disinvestment. 

The Department of Investment and Public Asset Management  which comes under the Finance Ministry defines Strategic disinvestment as follows: “Strategic disinvestment would imply the sale of a substantial portion of the Government shareholding of central public sector enterprises of up to 50%, or such higher percentage as the competent authority may determine, along with transfer of management control.”

The correct option is A.

Multiple choice organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

Qualitative measures to control credit are also called _______________.

  1. General Measures

  2. Selective Methods

  3. Both (a) and (b)

  4. Neither (a) nor (b)
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Qualitative measures to control credit are also called selective methods.Qualitative methods of credit control affects specific sectors of the economy. Qualitative instruments of credit control are those instruments which focus on select sectors of the economy. This policy of credit control is also known as policy of selective control.